Practical Capacity Is Used as the Numerator for Activity Cost

question 41

True/False

Practical capacity is used as the numerator for activity cost driver calculations to avoid distortions caused by the assignment of excess capacity costs to the products.

---

Definitions:

Outgroup Heterogeneity Effects

The tendency to perceive members of an outgroup as more similar to each other than members of one's ingroup, often leading to stereotypes.

Stereotypes

Overgeneralized beliefs or expectations about the characteristics, behaviors, and roles of a particular group of people.

External Attributions

The process of attributing the cause of one's own or others' behaviors and outcomes to external factors.

Fundamental Attribution Error

The tendency for observers to over-emphasize dispositional factors and under-emphasize situational factors when explaining others' behaviors.